With revenue and ridership down while operating costs continue to rise, the
South Shore is proposing a 2 percent across-the-board fare increase in each
of 2010 and 2011.

The cost of a one-way ticket from Dune Park Station here to Millennium
Station in Chicago would jump from $6.65 to $6.80 as of June 1 and to $6.95
in June of 2011. Monthly passes would go from $189.70 now to $193.50 and
$197.35 over the same period.

The last fare hike was 2 percent each year in 2006/2007. In November, 2009
the South Shore rescinded a promotional fare break for weekend and holiday
adult passengers that had been in effect since 2003.

Public hearings at five locations will be held in mid-March on the new fare
changes; the public comment period closes March 18 with a final vote by
Northern Indiana Commuter Transportation District directors scheduled for
March 26.

NICTD staff also is proposing two other changes. The policy currently
allowing up to two children to ride free with each adult on off-peak weekday
and all weekend/holiday trains will be changed to one child per adult;
infants would continue to ride for free.

Also, Train 11 departing Millennium Station at 3:58 p.m. will be designated
a rush-hour train requiring all children to pay a reduced fare. NICTD
director of marketing John Parsons said commuters have expressed concern
that they have to stand when the seats are occupied by non-paying
passengers.

Parsons said a 2 percent fare increase should raise about $200,000 this year
and $350,000 next year. Changes to the family-fare policy may yield about
$150,000 annually, and Train 11 redesignation could generate $15,000 more a
year.

NICTD general manager Gerald Hanas said South Shore farebox receipts have
dropped by $1.2 million and income from state sales tax has dropped by
$500,000. Coupled with a $750,000 increase this year for contract employee
healthcare insurance, Hanas said salary and wage freezes, furlough days and
service cuts all are being evaluated as cost-cutting measures.

NICTD chairman Mark Yagelski of the LaPorte County Council said the railroad
is in negotiations with its labor unions.

"We’re not singularly hit by the recession,” said Hanas. “Every railroad
with the same profile has been.” Ridership is projected to remain flat for
the next 30 months, he added.

In 2009 the South Shore carried 3,885,073 total passengers, down 7.1 percent
over 2008 although five construction-related weekend service outages did
occur last year. In both 2006 and 2007 NICTD carried over 4.2 million
passengers.

Parsons said NICTD is gearing up for selected weekday trains serving
McCormick Place for the Feb. 12-21 Chicago Auto Show. March 6-14 the Chicago
Flower and Garden Show returns to Navy Pier.

Insert card,
receive ticket

Approved Friday was a three-year contract with Chase Bank of Merrillville at
$200,000 annually to process credit and debit card transactions for NICTD’s
new ticket vending machines, which should go into operation shortly.

Randy Welch of NICTD said conductors on trains typically collect $4.3
million in cash ticket sales a year and the ticket machines are expected to
cut that by 85 percent, reducing the number of armoured-car pickups and
audits.

Tickets still will be available from station ticket agents. There is a $1
surcharge for tickets purchased on the train if a ticket window had been
available.

In other business, Hanas said 2010 capital projects financed with dedicated,
non-operating funds will proceed as planned. This includes upgrading the
overhead catenary power supply from Michigan City to Gary and upgrading the
signal system from Michigan City to South Bend.

An aggressive asset modernization program has been underway for some time to
lower operating/maintenance costs and improve on-time performance.

2010 groundbreaking also should take place on the new $15 million Kensington
bypass track and realignment in Illinois, a chronic bottleneck responsible
for South Shore delays. Construction should be completed in 2011, said Hanas.

Car reliability
being assessed

Responding to a question from the audience, Hanas said a few of the 14 new
double-decker South Shore train cars have experienced auxilliary power
supply problems. The cars were put into service 11 months ago.

Hanas said it hasn’t been determined whether the problem results from local
conditions including the cold weather, or from some issue related to quality
control. The cars were built by Sumitomo of Japan and assembled in
Milwaukee, Wisc.

The train cars are under warranty and Hanas said NICTD is working with the
manufacturer to isolate and correct any problems.

In addition to Yagelski being elected 2010 NICTD chairman, Porter County
Commissioner John Evans was elected vice-chairman, Lake County Council
member Christine Cid treasurer and LaPorte County Commissioner Barbara
Huston secretary.